House-buyers unwittingly lumbered with home that leak can get huge compensation under tough new rules.
Real estate agents could be fined $100,000, and vendors are being warned about the severe repercussions of cover-ups.
The conveyancing head at Milford law firm Schnauer and Co, Nick Kearney, said new regulations came into
force last month.
Under the Real Estate Agents Act (Professional Conduct and Client Care) Rules agents can be sued for not telling buyers about leaky homes, he said.
"If an agent knows - or should know - about defects in a property, they must get confirmation from the vendor that there is no such defect or advise the purchaser of the potential risk," Mr Kearney said.
The law firm's director, David Schnauer, said the new Real Estate Agents Act, which came into force on November 17, was tougher on agents than the previous law.
But the new rules went much further than the act in protecting house buyers against leaks, he said.
"The rules are very little known and contain major changes to protect buyers of potentially leaky homes," he said.
"Buyers have been given significant new remedies against agents who knowingly sell them leaky homes without disclosure."
Real estate agent Steve Koerber of Barfoot & Thompson has accused vendors and other real estate agents of not disclosing enough information about houses.
Migrants were particularly at risk, he said, because so many were unaware of the dangers of buying a New Zealand house.
"Hundreds of new immigrants and some locals are stitched up into potentially leaky or leaky homes," Mr Koerber said this year.
